Ways to lower inheritance tax bills

People have been advised of methods – such as making a will – that they can take to reduce the cost of inheritance tax for their loved ones.

Cityam.com said writing charity wills means the organisation the estate benefits will not have to pay inheritance tax.

However, this is not the case when it comes to friends and family, meaning that steps should be taken now to prevent them facing a financial burden.

One option is to give will beneficiaries £3,000 every year, which will not be subject to inheritance tax. This amount can be increased to £6,000 in a case where this sort of gift was not made in the last tax year.

The news source also advised parents that it's possible to treat all of their children to a £5,000 gift for a civil partnership or wedding, while grandparents can contribute £2,500.

In addition, the Institute of Public Policy Research recently proposed that there should be a tax on the receipt of inheritance rather than the gifting.

Published by Tessa Jones